Corporate Governance

Corporate Governance continues to be a strong focus area for the Company. Our philosophy on Corporate Governance in Eicher emanates from resolute commitment to protect stakeholder rights and interests, proactively manage risks and create long-term wealth and value. It permeates in all aspects of working – workplace management, marketplace responsibility, community engagement and business decisions.

The Code of Conduct and the governance are based on the corporate principles and strong emphasis laid on transparency, accountability, integrity and compliance.The governance processes of the Company include creation of empowered sub-committees of the Board to oversee the functions of executive management.These sub-committees of the Board mainly comprise Non-Executive Directors and Independent Directors, which meet and deliberate regularly to discharge their obligations.

In India, Corporate Governance standards for listed companies are regulated by the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 [SEBI (LODR) Regulations, 2015]. The Company has adopted best practices mandated in SEBI (LODR) Regulations, 2015.

In terms of Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations"), the Company conducts familiarization programmes for the Independent Directors, including, through leading firms of Chartered Accountants in order to provide them with the insights on the Company to enable them to understand the Company's business in depth and to familiarize them with their roles, rights and responsibilities towards the Company while discharging their functions as member of the Board and also as member of various committees. The programmes also include detailed discussions on corporate governance norms and procedures as envisaged in Companies Act, 2013 and the Listing Regulations.

Generally, Familiarization Programmes for Independent Directors are designed considering that most of the Company's Independent Directors have served on the Board of the Company for several years. Furthermore, such programmes are merged with the Board/Committee meetings and forms part of the Board process, for the convenience of the Directors. The Independent Directors are periodically updated at the Board/Committee meetings, through presentations made by Senior Management of the Company which assists them to understand strategy, operations and functions of the Company including the following:

General business environment and operational model of business of the Company including important developments thereon;

Roles, rights and responsibilities of directors;

Important changes in regulatory framework having impact on the Company;

Major developments at the manufacturing facilities of the Company its services and products offerings.

Details of the Familiarization Programme

During the financial year 2016-17, one programme was conducted on December 20, 2016, wherein presentations were made covering areas like Corporate Social Responsibility, understanding its gravity & governance structure; Cyber risk, its relevance, effective management and defence; Goods and Services Tax (GST), its proposed framework & impact on Company's business, differentiating between current tax regime and GST regime. All Independent Directors of the Company attended the above programme. Independent Directors spent 5 hours on the programme.

During the financial year 2015-16 and financial year 2016-17, the familiarization programme was also integrated with the Board/Committee Meetings and the Independent Directors were given detailed presentations on financial and operating plans of the Company, major capital expenditure, enhancement in R&D and manufacturing facilities, internal financial controls, corporate social responsibility projects, strategic business plans and budgets, effect of Indian Accounting Standards on financial reporting and in aggregate, approximately 16 hours were spent by them.

Other Relevant Details

The Independent Directors are also familiarized with their roles, rights and responsibilities at the time of their appointment through a formal letter of appointment. Independent Directors, periodically meet members of the senior management team. They are also provided with a copy of latest Annual Report, Eicher's Code of Conduct for Directors and Senior Management, Eicher's Code of Conduct for Prevention of Insider Trading, to name a few.

Independent Directors are also facilitated to meet without the presence of the Company's management to discuss matters pertaining to the Company's affairs. The Company also organizes plant visits to facilitate them to understand the Company's operations in detail and where plant and other departmental heads apprise them of the operational and sustainability aspects of the plants and initiatives taken on safety, quality, CSR, Sustainability, industry dynamics etc.